Travis County Commissioners Court
May 17, 2005
Item 24
24. Consider request by duke bishoff for an accounting of procedures taken by rylander investment in sale of certain assets at the farmers market, and take appropriate action. Good afternoon.
>> good afternoon, judge Biscoe, honorable commission. I know that you all have had a long day. I have the honor of sharing part of it with you from the audience, I will try my best to be brief. Judge Biscoe and the honorable commissions, my name is david godfried, an attorney here in Travis County, I represent duke and kathleen bishoff, very briefly they were tenants at the Travis County farmers market from may 1997 through December of 2003 at which time they sold their restaurant business to a group called the astound group. The equipment that is at issue today was sold to the astound group for approximately $31,000 on an installment contract. Mr. Bishoff filed a valid ucc 1 financing statement with the secretary of state. Approximately 10 months later the astound group defaulted on their lease with the county, they reling quished control of the equipment back to -- relinquished control of the equipment back to mr. Bishoff at which time he proceeded to sell it again for a second time to a john miller. Mr. Miller had signed a lease with the county in the beginning of December of 2004. At that time mr. Bishoff sold the equipment for approximately 30,000, again using an installment contract. Within the ensuing weeks, apparently mr. Miller defaulted on his lease. The county's agent, mr. Hill rylander, contacted my client, mr. Bishoff because he understood that mr. Bishoff had a potential new tenant for the county. And a potential new buyer for mr. Bishoff's equipment. Mr. Bishoff had come in contact with the gentleman named danny right while he was negotiating the deal with mr. Miller. In helping the county get a new tenant and in the self interest of a new restaurant continuing there, they would need his equipment, he assisted mr. Rylander in getting in touch with danny wright and apparently mr. Wright signed a lease sometime in the beginning of January of 2005. Or perhaps it was the middle of January of 2005. Then mr. Bishoff received a phone call from mr. Rylander telling him that mr. Rylander on behalf of the county had in fact sold mr. Bishoff's equipment and he had a check for him for his portion of the proceeds. Mr. Bishoff went down and met with mr. Rylander and he advised him that under the authority of the county as the landlord, he had sold the -- mr. Bishoff's equipment and written him a check for $3,000, tendered that to mr. Bishoff. Mr. Bishoff took the check, made a photocopy of it and returned it later to mr. Rylander's office because he was not accepting that deal. He never gave the county or mr. Rylander the authority to sell his equipment. He certainly would never get authority to sell his equipment for $10,000 which 45 days earlier he had sold for $30,000. The question is why are we here? We are trying to get some answers. Mr. Bishoff does not relish the thought of having to enter into litigation with his county. He's been a resident of this county for some 25 years, he's just trying to get some answers about under whose authority mr. Rylander has been acting. I sent letters to mr. Rylander, mr. Wright, inquiring about this issue, asking for bills of sale, copies of notices that were sent out under which mr. Rylander thought he had authority to sell mr. Bishoff's equipment. I got a call back about 20 days later saying he needed more time 7 then got a letter from his attorney, I知 not sure I知 assuming it was his attorney as an individual and not as an agent of the county, but I can't be sure because he will not tell me. His attorney, mr. Guzman advised me that, number one, mr. Bishoff did not have a valid ucc financing statement. For this equipment because it didn't accurately describe the equipment. Number 2, any financing statement or security interest that mr. Bishoff had in the equipment was subordinate to a landlord's lien. And, number three, that even if he had a valid security interest, he had no standing. The only person that could possibly have a claim would be mr. Miller. We have legal arguments that negate all of those defenses. In any event, what I asked for are the documents under which mr. Rylander believed that he had the authority to sell mr. Bishoff's equipment to mr. Miller, none have been forthcoming. I expect that there are none. The proceed proceed for sequestering a tenant's commitment under a commercial lease is to request a distress warrant from the justice of the peace. Certainly mr. Bishoff got no notice of that. Mr. Miller got no notice of that. We don't think one exists. It's our belief that mr. Rylander under the guise of being an agent of the county simply took the equipment, sold it at a private sale for -- for an amount grossly under the fair market value to the new tenant, and cut a check for $3,000 to mr. Hoping that he would go away. Well, he's back. And he would like to receive the fair market value for the equipment from the entities that derived that benefit, which is arguably either mr. Rylander's management company or the county itself currently the county has a tenant in there using all of this equipment and presumably paying rent, so there's certainly a benefit to the county to continue to have a -- a viable tenant in there, county can't have a viable tenant in there if they don't -- if the tenant doesn't have this equipment. R. Bishoff would like to get a fair resolution, but we are not getting the answers that we need. We are coming to the Commissioners court to see if we can get some of those answers either through an accounting or some direction.
>> you do realize what rent gets paid, what dollars are exchanged here, 99.9% of that, of those dollars goes into the checking account of mr. Rylander. Travis County has a -- a checkered 15 year history of getting virtually nothing off the deal. Let me assure you that if there were any dollars there, they are inconsequential and they are with somebody else. Since a lot of what you just said mr. Godfried seems to be questions of fact, is there some reason that you don't just file litigation and sue mr. Rylander and get answers to those questions of fact?
>> there are a number of reasons. The first is that mr. Bishoff is not a wealthy man and that litigation could prove to be very costly as -- as mr. Bishoff has observed mr. Rylander's litigation history. The second item is that mr. Rylander, my analysis of the law is that he could only be acting as an agent of the county in doing what he is doing.
>> he didn't ask us about any of this.
>> Commissioner Sonleitner, I have no doubt about that. Like I said earlier, mr. Bishoff does not want to sue his county. Whater hoping for is that this court would have some authority over its agent to right this wrong short of litigation. If the answer is mr. Godfried just file your lawsuit, I will do whatever I can to work with mr. And do just that -- owe with mr. Bishoff and do just that, we thought it was incumbent upon us as citizens of Travis County to come before the court and do that.
>> you are asking us basically what we can do to help you obtain from our agent evidence of authority plus documentation of the sale.
>> yes, your honor.
>> so -- we will need to chat with legal I guess in executive session to find that out, right?
>> [indiscernible] most everything that I know is from mr. Bishoff.
>> I think that -- I知 sure we would be authorized to send a written request for the information.
>> yes.
>> because if he's our agent, I知 assuming that --
>> he does have a fiduciary and a contractual obligation to provide us information that he has and any paperwork that he has, yes.
>> the question is legally what can we do, let's discuss that in executive session. We will get you an answer today, okay. We will do what we can.
>> thank you, judge Biscoe. I believe that the Commissioners court has already asked mr. Rylander to provide that in their letter to him of February 11th.
>> what does that letter say, what do we ask for.
>> if I may approach, i've got copies.
>> is that from mr. Hilly. Mr. Guzman that you mentioned does not work for Travis County. Mr. Hilly works for Travis County. He's our attorney.
>> are you -- you are asking mr. Mr. Guzman works for mr. Rylander, right if.
>> I don't know under what authority mr. Guzman is writing to me. You know the -- the -- I will not presume to tell the county attorney the law of principal and agent, but it's -- it's my belief that the -- that the principal, the Travis County, is going to be responsible for the acts of its agent done within his authority. Now, I understand that there's some gray area as to under what authority --
>> within his authority. Because what the phrase that you used before, the only way that hill could have acted -- well, you probably should add that extra way the only legal way hill could have acted, that's -- that's who mr. Guzman represents, it's hill and not the county.
>> perhaps I知 being a little too much of an advocate not a good enough reporter of just the facts. What we would like to see an accounting of that sale.
>> so would i. You have got a fan here, sir.
>> seems to me that we could write a letter asking more specifically for certain items.
>> I would be happy to send a letter with the direction. With a list that mr. Godfreed would provide us.
>> put us a list together. We will be in executive session a while today, so put that list together, when we come back out, we will dhat with john about this further in there. When we come back out, we will look at your list and see what we can incorporate into a simple letter that specifically requests certain documentation.
>> thank you, judge.
>> seems to me that we ought to do that if we are authorized to do it.
>> okay.
>> I will give you that advice.
>> thank you.
>> thank you. Don't leave. Leave there, but don't leave the room. [laughter] we will be back shortly.
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Last Modified:
Wednesday, May 18, 2005 7:54 AM